BNSF withdraws from grant process for rail bypass in Willmar, Minn.

BNSF has pulled out of
the application process for federal stimulus money to help build a railroad
bypass on the west edge of Willmar, Minn., the West Central Tribune reports. In
a letter sent to city officials, the railroad said that after a further review
of the application guidelines, it saw "no possibility" that BNSF would be able
to obtain a planning grant for the proposed multimillion-dollar project.

Local officials said they're
disappointed with the turn of events.

"The greatest
disappointment is the loss of what we thought were the benefits," said Steve
Renquist, executive director of the Kandiyohi County and City of Willmar
Economic Development Partnership.

The proposed project
would have shifted the Morris-to-Marshall subdivision traffic out of Willmar's
central rail yard and routed it to a bypass on the west edge of town. The move
would have opened up rail access to Willmar's industrial park. It also could
have enhanced the possibility of cargo service at the Willmar Municipal
Airport, as well as position the city for a light-rail commuter train service.

City officials had in
fact been discussing the options with BNSF on and off for "a number of years,"
said Bruce Peterson, community development director for the city of Willmar.

"The main thing was to
get that western bypass," he said.

With the shelving of the
application process for a stimulus planning grant, "the local impact is
significant," Peterson said. "It makes it extremely difficult to get access to
the expanded industrial park."

Construction of a rail
bypass would have required a massive financial investment - an estimated $33
million to $58 million, including not only the cost of construction but land
acquisition, permits and environmental reviews as well. The scope of the
project is such that neither local government nor BNSF could have financed a
rail bypass on its own, Peterson said.

The availability of
stimulus funding for transportation projects created a unique and perhaps
one-time chance to apply for outside funding, Renquist said.

"The window of
opportunity opens and closes. Nobody knows how long it's going to stay open,"
he said.

The timeline for
decision-making also was short. Preliminary grant applications are due at the
end of July. Final applications are due in August, and grant awards are
supposed to be announced in October.

But after reviewing the
guidelines again, BNSF officials told the city this week that in order to be in
the running for a planning grant through the National Infrastructure
Investments Competitive Grant Fund, the railroad would have had to obtain a
significant level of non-federal funding for the project. BNSF is "simply not
in a position to make that commitment," railroad officials said in their
notification to the city.

Local support for the
project was strong. As recently as last week, the operating board of the
Economic Development Commission voted to commit $50,000. The Willmar City
Council also was prepared to consider making a financial commitment.

Renquist said he hopes it
sends a signal to BNSF that local officials want to continue the discussion.

"The stimulus program isn't
over yet," he said. "We don't quietly go into the good night. Under the right
circumstances, this could be a project they'd still like to do."

"We'll maintain contact
with BNSF and keep trying to do whatever is possible and affordable," Peterson
said.